YapStone News

5 Ways Startups Evolve Into Successful Companies

May 16

[“5 Ways Startups Evolve Into Successful Companies” originally appeared on TheStreet and is written by Ellen Chang.]

Among the tens of thousands of startups created each year in the U.S., the burgeoning companies that transition into successful enterprises are few and far between.
Although the failure rate remains extremely high, entrepreneurs continue to seek innovative solutions to existing problems, helping to build a new workforce and increase productivity across various industries.

The pitfalls of starting a new business are numerous as founders often find themselves devoting too much time chasing funding or customers while others expand too quickly and wind up having to lay off a significant portion of their team to remain in the black.

One-quarter of Americans have thought about becoming business owners, but opted out of the prospect, according to a Gallup poll conducted in 2014. This is not surprising since the number of startups which have failed or shut down since 2008 outnumber those which are being created.

The barriers to entrepreneurship are numerous, resulting in 50% of new companies which cease operating during the first five years. A lack of available early-stage funding, especially for minority and female entrepreneurs, job security and coaching also present hurdles, according to Gallup.
The trade-off for founders is often gratifying as they learn from their mistakes and develop new strategies.

“In entrepreneurship, everything starts with why,” said Paul O’Brien, co-founder of MediaTech Ventures, an Austin, Texas-based economic development of innovation in media, and a partner in 1839 Ventures, a venture capital firm providing financing to early-stage technology-oriented companies. “Whether or not you attract co-founders and partners, appeal to investors or customers, or catch the attention of the media and consumers, it depends on understanding why you are doing what you are doing, why anyone will care and why it will matter.”

Here are five tips from startup founders or employees for entrepreneurs who are seeking to transform their small businesses into profitable companies.

1. Don’t Focus Solely on Growth

Controlling a company’s expansion or growth rate is critical since it can lead to burning through cash too fast and creates other problems.
Between the opening of their first and second locations, Leon Chen, co-founder of Tiff’s Treats, an Austin, Texas-based warm delivery cookie company with 28 stores, waited seven years. The delay helped the company which was founded in 1999, ensure their processes and procedures lacked any errors.

“Do not get enamored with growth for growth’s sake,” he said. “Even today as we are at close to 30 stores, we will never grow store count faster than the infrastructure in place.”
Tiff’s Treats has raised over $30 million in funding, including $25 million from the past two years. The company’s first round of funding did not occur until 2008.

2. Realize Bootstrapping Is Not a Failure

Too many startups devote a large amount of their time on fundraising to obtain capital from venture capital and private equity firms and often shift their focus away from their customers or developing a sound business model where generating cashflow is not problematic.

Smarsh, which was founded in 2001, bootstrapped for many years before the Portland, Ore.-based provider of cloud-based information archiving solutions, took on private equity investment. While many start-ups view fundraising and outside investment as an “imperative or a badge of honor,” it can be misguided, said Steve Marsh, founder and CEO at Smarsh.
The company was able to grow “without relying on the crutch of financing while spending responsibly and creating a profitable model,” he said. “We were able to make good decisions and listen to what customers really wanted to guide us to the next phase of growth. It wasn’t always easy, but any bumps in the road ultimately made the company stronger in the long run.”

Smarsh now has 215 employees.

3. Understand the Problems of Customers

Entrepreneurs who create a product they personally find useful are often more successful, because they understand the existing gap, said Dom Sagolla of his experience when he was head of quality at Odeo, a former podcasting service which was founded in 2005.

“Build something you personally need to have,” he said. “Often teams fail because they are not the target audience for their own product and do not realize when it needs fixing or pivoting.”
Sagolla is now director of Developer Camp, a San Francisco-based startup accelerator and community-building organization.

The founders also need to focus on the problems of their customers, especially in the early days instead of merely of approaching it from their original mission even if they have obtained funding, said Sean Wilcox, who was the senior director at Clearwell Systems that was sold in 2011 to Symantec for $420 million.

Startups need to understand the goals of their customers and be agile with solutions, he said.

“It is critical until the startup finds a repeatable playbook that delivers enough value to create a sustainable business,” said Wilcox, who is now vice president at GrandCanals, a Los Gatos, Calif.-based provider of analytics-driven fulfillment and a long-time advisor to startups across various industries. “There are exceptions, but the ideal situation founders foresee in a business plan is usually not fully supported by today’s reality.”

4. Stick to Your Plan

Startups face an enormous amount of pressure from investors and stiff competition from other businesses in their industry.
Companies that do not lose their vision or goal will be able to make their new innovative product a reality. The founding team must be “100% committed to delivering the innovation to market,” said Kim Bond Evans, CEO and founder of Seremedi, a Houston-based patient healthcare tech company which was founded in 2014, has raised $2.5 million and has 11 employees.

“As there will always be barriers and obstacles if you are delivering something disruptive, the founding team has to find a way or make a way and always be asking themselves what can I do with what I have,” she said. “Build a culture of thoughtful truth tellers. In order to fix it, you must acknowledge it.”

Even if your startup only has a handful of employees and lacks funding, do not be afraid to approach larger potential clients, said Tom Villante, co-founder and CEO of YapStone, Walnut Creek, Calif-based payment technology solutions company which was founded in 1999.
“Starting a company takes a good dose of elevated reality by believing that you and a couple of employees in a 300-square foot office can compete and win against billion dollar companies to one day be worth a billion dollars yourself,” he said. “There are plenty of times when it seems like the world’s against you, but you have to get up, brush yourself and say ‘why not us’ and get your employees to believe it, too.”

Yapstone now has 500 employees and revenue in 2017 is estimated to be $300 million.

5. Seek Advisors or Mentors in the Early Days

Whether you turn to advisors who give you advice occasionally or create a formal board, their insight can provide long-term guidance, especially as you are launching the first product.

“The influence of early stage board members can’t be understated,” said Elizabeth Lawler, CEO and co-founder of Conjur, a Waltham, Mass.-based trust management software platform with 20 employees. “Find people who compliment or augment your skill set and look for individuals who will be a steady supportive presence through tough times and periods of change.”
Founded in 2013, Conjur is backed by Amplify Ventures, Avalon Partners and Koa Labs and has 20 employees.

Advisors can help entrepreneurs, especially founders tackle problems from a different viewpoint or seek other solutions.

“When you are in the thick of things, you may develop bias you don’t even realize you have,” said Evans. “You may be set on plan A or B when there is a plan C that’s even better. Wise, thoughtful honest counsel is priceless as it helps you clear those hurdles and enables clear, expansive thinking as you make critical decisions. It helps you be your best.”
Young or new entrepreneurs are matched with experienced mentors and advisors at each Developer Camp, said Sagolla.

“The value of this program is that entrepreneurs get to experience the top echelon of startup life: they are the best of the best,” he said.

Why Marketplace Companies Will Demand Fintech Innovation

May 16

[“Why Marketplace Companies Will Demand Fintech Innovation” originally appeared on Y Insights and is written by Robbie Abed.]

This interview is part of our Future of Fintech Series where we interview disrupters in Fintech. Tom Villante is Chairman, CEO and Co-Founder of YapStone. Founded in 1999, the company has raised over $110MM from investors, including Accel Partners, Meritech Capital and Bregal Sagemount. With a mission to change how the world pays, YapStone offers an end-to-end payments solution for global marketplaces and large vertical markets.

We live in truly revolutionary times. The world is changing at a rapid pace and we can pretty much get hold of anything we need whenever we need it. Thanks to this ease of access, consumers’ preferences are naturally becoming more demanding. Companies that fail to satisfy them will ultimately be replaced by providers who can.

The marketplace business model is an excellent example of companies able to identify and satiate consumer desires. By creating a new way of exchanging goods and services, businesses in all verticals are forced to sit up and take notice – or fall by the wayside like Tower Records and Blockbuster Video.

The rise and rise of marketplaces

From raising finances to online entertainment, transport and vacations to freelance employment, marketplaces are causing widespread disruption across the board. More than half of the workforce could be working remotely online by 2020, thanks to companies like Upwork and TaskRabbit.

Kickstarter democratized the once private and elite capital raise process and gave anyone and everyone the opportunity to participate. Since its inception in 2009, this crowdfunding platform has helped raise almost three billion dollars for products to come to market.

Uber (valued at $68 billion) has upset the taxi industry worldwide and turned our personal cars into personal revenue streams. Airbnb took on traditional hotels and monetized the extra rooms in our homes. HomeAway offered travelers their dream vacation while giving homeowners the opportunity to leverage their second homes. And Etsy gave independent artisans the ability to scale a local business, turning a hobby into a real career.

For the average consumer, these relatively new services have become intrinsic to our daily lives. All we have to do is download an app and we can organize our activities from our smartphones. But how is it that marketplace companies have been able to achieve such widespread market penetration and success?

Marketplace companies built their services with a number of goals, yet the common thread was paramount – ease of use. Regardless of service or industry, they had to make it easy for both the buyer and the seller to use, and they did so by leveraging our mobile devices. Considering that as many as 77 percent of Americans now own a smartphone, this was a sound strategy to follow.

With a revolutionary business model, desirable product, engaged audience and enviable potential, it would seem that marketplaces have it all figured out – or do they?

The complex payments issue

As marketplaces continue to disrupt, expand and scale, the issue of payment processing becomes ever more critical. They need to evaluate the payment transaction and process (as it’s one of the few areas where friction still exists for the consumer). This is where fintech comes in. Partnerships and products will be the next strategic area of focus for marketplaces.

With 17 years in the payments industry and experience powering online payments for global marketplaces, Tom Villante, CEO and Co-founder of YapStone, understands marketplace companies like no other. He comments:

“Payments are inherently hard and complicated and they will not be getting any easier for marketplaces as they scale globally. In order to fully support a transaction for the buyer and seller, these companies will have to build an entire in-house ‘payment company’ or create one as a subsidiary. But the simple fact is that marketplaces are not payments companies, they already have a business. A business that they have been very successful in building and growing. If they are running their business and building a payments platform, inevitably, it will take away their focus and could negatively impact growth.”

Online payments are critical when talking about marketplaces. These companies are responsible for millions of online or mobile transactions every day. The sheer complexity of the payment platforms needed to process these transactions is overwhelming. Funds must be disbursed to multiple entities in multiple currencies. Consumers’ information must be protected. Safeguards against fraud need to be applied and industry standards for security and compliance have to be met. Not to mention providing 24/7 customer service.

Add in the goal of hyper-growth and scale that marketplaces are reaching for, and the financial responsibility increases exponentially.

The need for fintech

“Most marketplaces do not want to deal with the complexity, and to be honest, the burden of online payments,” says Villante. “With the exception of Uber and Airbnb, which mainly manage payments in-house (or with support from partners), marketplaces are not willing to take on the challenges of going deep, building a team to manage payments and regulatory obligations, as well as risk and fraud.”

To solve this problem for marketplaces, YapStone began offering a customized, end-to-end payments solution for marketplaces. “For six years, we have been powering payments for HomeAway, the world’s leading online marketplace for the vacation rental industry. We have acquired in-depth knowledge and expertise on what these companies need in a comprehensive payments partner,” says Villante. “With this in mind, we take care of the entire payment transaction, from processing to customer service, so that the marketplace can focus on what they do best – their business and delivering a convenient product or service to their consumer.”

The quest for global expansion of marketplaces has created the need for business requirements that were never contemplated before. In fact, marketplaces are going where no one has gone before! And they need services that have never been designed, built or employed — especially when it comes to fintech.

One major concern for marketplaces is risk and fraud. Villante states, “Fintech companies must protect their customers against fraudsters and the schemes employed across the globe.” This includes creating fake merchant accounts to pose as mules to drain stolen card accounts and posting photos of a fake property at a too-good-to-be-true price.

A marketplace could find itself in real trouble without a payments partner to help navigate the complex world of global payments, ensuring compliance, security and ease of use for consumers.

“Before we started powering payments for marketplaces, we had a small risk team. Now we have 70 experts, in addition to our ongoing financial investments in building and integrating next-generation risk and fraud solutions,” says Villante. “We have also developed a global view of the customers who transact in the vertical markets we serve. This helps us separate those customers that are known, safe and operating within pattern from customers that require closer evaluation.”

Because fintech companies have global experience and dedicated teams, they are in a better position to prevent fraud for their marketplace customers. As marketplaces scale and grow in their own businesses, it will become increasingly difficult to build and manage the inherent complexity of online payments. That makes fintech and marketplaces a match made in heaven.

About Tom

In 1999, Tom Villante founded YapStone with the simple goal of converting bills commonly paid by paper check into online electronic payments. Today, YapStone processes over $18 billion in online and mobile payments and has raised over $110 million in capital. As Chairman and CEO, Tom leads the strategic vision, operational execution and global expansion of the company. With his experience and expertise in the FinTech industry, Tom is focused on positioning YapStone’s innovative and proprietary payments platform to meet the needs of global marketplaces and large vertical markets.

Prior to YapStone, Tom was a Partner at The Seidler Company, a private equity firm, and an investment banker with S.G. Warburg (now UBS) and William E. Simon & Sons. In addition to his role at YapStone, Tom is a member of Young Presidents’ Organization (Santa Monica Bay) and has served on the Boards of local schools and charitable organizations. With 20 years of entrepreneurial experience, he is an active angel and real estate investor, frequent speaker at FinTech and Leadership conferences as well as a contributing writer to notable business publications. Tom earned a Bachelor’s Degree from Princeton University.

YapStone Matches Property Dwellers to Frictionless Payment Processes

May 08

[“YapStone Matches Property Dwellers to Frictionless Payment Processes” originally appeared on PYMNTS.com.]

In the late 90s, YapStone’s current CEO and chairman, Tom Villante, was an investment banker looking for his next big thing. Back then online was new — Amazon was a mere toddler, and online marketplaces were mostly Craigslist and eBay. But it was the latter that got Villante’s attention — since that marketplace, without PayPal, was nothing more than a catalogue of products that consumers could see, but not buy — or at least, not without massive friction. The notion that payments could be such a powerful catalyst for transforming that online catalogue into a commerce engine was intriguing. More than that, Villante was struck by the notion that the PayPal platform was actually enabling thousands of individual merchants to accept digital payments and make a market where none had existed.

One evening, while playing poker with a group of buddies, the lightbulb went off.

“I was looking for something that could scale, and payments intrigued me —particularly looking in markets that were traditionally paper check,” Villante told Karen Webster during the most recent episode of The Matchmaker Is In. “I asked them ‘What’s the one check that you write every month?’ Most everyone said – rent. That gave me the idea to find a solution to turn rent checks into a digital payments business.”

So, off Villante went, knocking on the doors of the mega apartment landlords. “Thanks but no thanks,” he heard countless times, given the fee structure that made cards an expensive form of payment to accept — landlords didn’t take kindly to the $1000 rent check minus a 2.75 percent or higher fee. That’s when Villante turned the traditional “merchant pays” business model on its head and introduced consumer-directed convenience fees — renters would pay a small fee to the landlord for the ability to send payments digitally instead of writing and mailing a check.

That, Villante said, was what created the foundation for using digital payments to unlock untapped value in marketplaces where buyers and suppliers were conducting commerce — big ticket commerce — using paper checks. In this week’s episode of The Matchmaker Is In, Villante recounts the evolution of fax farms and credit card authorization forms to enabling payments for mega vacation rental establishments like HomeAway.

Here’s an excerpt of that conversation.

KW: So take us back. You went into these large apartment conglomerates and said listen, guys, “Sign on with us and we’ll not only digitize these paper checks that you’re getting from your renters, but we’ll do the end of month reconciliation for you.” Was that your sales pitch?

TV: Exactly, and they wouldn’t have to pay a dime for it. There were a lot of things happening on the back end to make it happen, too.

Remember, this was 1999, so at the time, people didn’t want to enter their credit card information online — and neither did the property managers. The method of doing business was the fax machine — renters faxed in their credit card information. We had these huge fax farms that were our cash registers!

And that’s how we started in a 300 square foot office in Pacific Palisades. One small win after another, and we did small fundraising from family and friends in the beginning which lasted us until we were first profitable 15 months in. We didn’t raise our $50 million round until 2011. We built on apartments and then went into vacation rentals in ’06 / ’07.

KW: It’s unusual to have a consumer pay to make a payment. How did you persuade consumers to do that?

TV: Initially, it was not easy to sell and there was a two-step marketing where we’d sell to the property and hope that the property would sell to the end resident. The associations weren’t crazy about convenience fees at the time, but eventually they saw the volume that we were doing and growing and knew that it was all new volume — and a large opportunity for them. There’s $450 billion a year total in the U.S. in rents and security deposits — that had the potential to run across the Mastercard and Visa rails. They worked with us in exchange for helping open this new market.

KW: How did you get into vacation rentals?

TV: One of our sales reps called on a vacation rental by mistake in ’06 thinking it was an apartment management company. We signed them up because they didn’t have “vacation” in their name. All of a sudden, they become our largest volume customer – larger than even a 100,000 unit apartment. We found out there were 20 people at this company and it’s a vacation rental company in the Southeast. They were pretty soon doing $100 million volume with us a year. That gave us the idea that there’s a big business there — and a more traditional merchant-pays business model — online. It also seemed perfect for online payments. So off we went to sign up 20 of the largest vacation rental software companies to integrate with us.

KW: Are you still in the apartment rental business?

TV: We definitely are, and we’re doubling down efforts there because it’s still ripe. We’re going at it more from a marketplace perspective than from the hand-to-hand combat from the early days, because it’s a highly fragmented market. Seventy percent of the market are smaller landlords with less than 500 units, and 50 percent of people live in buildings of four units or less. Getting to those renters and landlords is really through some of these large apartment listing marketplaces.

KW: Are the things that are important to vacation rental operators and apartment landlords the same? What adjustments did you have to make to adapt your platform to serve them well?

TV: One of the big things was the risk component. We were signing up established landlords, for the most part, and so only needed one risk person. If there was a chargeback or fraud, we’d have a very credible merchant to capture that. Basically, we were only on the hook if that landlord ever disappeared, but that never happened in the apartment industry.

The vacation rental is filled with more credit risk then selling traditionally to property management companies. When you’re dealing with a marketplace of unidentified homeowners and renters, there’s the risk of collusion fraud where the listing isn’t based on someone’s own home. Believe it or not, people do steal credit card numbers and take a vacation — but we know those patterns.

We now have 70 people in risk and the data scientists that we have – and take on 100 percent of the risk on that marketplace – which is why we are also selective and enter markets we know well.

KW: It seems like for many of these marketplaces, payments is now a strategic part of their operation. What is your sense of how these operators view their business and therefore the role of a provider like YapStone?

TV: A typical marketplace is focused on growing and conversion, and that drives the features and functions we build into our platform. For example, for HomeAway, we pay homeowners instantly even if the booking is six months down the road. We’re able to do that because of the information we have and rating of the potential risk. Getting paid six to nine months in advance of the traveler showing up is a massive competitive advantage.

KW: As you think about your platform, what’s on the roadmap that you can talk about that further provides these players with a strategic advantage?

TV: It’s really end-to-end. Whoever you talk to, if they do pay in and pay out throughout the world, they’ve had to stitch together 10+ vendors. Some vendors do pay ins in the U.S., Europe, Southeast Asia and some have very few pay out capabilities. What we’re pulling together is really an end-to-end solution — a one-stop shop that uses software to connect seamlessly with their business. We’re plumbing, at the end of the day, but also we’re creating solutions on top of that that make us a valuable partner for our clients.

KW: Who in the matchmaking arena solves a customer or business problem well, from your perspective, and has scaled their business well?

TV: Uber has done a great job. They have a fantastic team on the payments side, and it’s a frictionless payment. It’s one of the most brilliant things that I’ve seen. The ability to go to multiple countries like they have and adapt to local economies is hard — and they’ve made it work. That frictionless eCommerce experience where the consumer isn’t even thinking about it is powerful.

Why Companies Should Ditch Long-Term Contracts

April 28

[“Why Companies Should Ditch Long-Term Contracts” originally appeared in AlleyWatch and is written by Erik Huberman.]

Work Smarter, Not Harder, to Scale Your Business

Many entrepreneurs identify with Thomas Jefferson’s saying: “The harder I work, the luckier I get.” It’s a lovely sentiment and it might even be true in the early days of a startup. But if you hope to run a high-growth company, working too hard can actually result in you running out of luck and putting your business growth prospects in jeopardy. Here’s why:

Say you start a business and it begins growing. All of a sudden, you find yourself overwhelmed by the workload. You are wearing multiple hats and there’s not enough time to wear any one of them well. That’s exactly the point when every entrepreneur doubles down, and lives, eats and sleeps their company. Sound familiar?

Tom Villante, CEO of the popular payment processing platform, YapStone, founded his company 16 years ago, and it now processes over $15 billion annually. I wanted to learn how he was able to relentlessly focus on scaling his business. And, thanks to a colleague, I was able to hop on the phone with him.

The fintech scene is exploding right now, and YapStone has become the largest electronic payments processor in vertical markets, particularly ones in the sharing economy, like apartment and vacation rentals. The rate at which both have rapidly expanded to create this new class of tech “unicorns” tells me anyone successful in the space has some advice about scaling/rapid growth. Tom’s partnership with HomeAway, which was recently acquired by Expedia for $3.9 billion, was most impressive to me, and a sign that his business is nailing its target verticals and should only continue to grow.

He said, “Times have changed since the 1700s. Today, working smarter achieves a much better result than working harder. Don’t get me wrong, I firmly believe in going all in and focusing on your business. Yet, it’s crucial to be efficient while growing your business and giving it scale — and part of that is about leveraging resources to keep from being spread too thin. Without our ‘work smarter’ strategy, we could have easily gotten mired into the day-to-day running of the business and not been able to build the payments platform that we have today.”

Tom offered the following points to help guide you in your quest to work smarter, not harder:

Hire People For Growth

Tom sees founders often choosing to handle a lot of work themselves, rather than delegating to others within the organization. As a manager, you should hire and reward people who are willing to pitch in and venture beyond their official duties.

The other side of that coin is long-term thinking: Onboard only those people who can grow with your business and become one of its leaders. Your next hire shouldn’t just fill the current position. Think about their potential: Can they can grow with you, and help get your business to where you want it to be?

Set Clear Goals

Always think about your employees strategically. How would you like them to develop and contribute to your team? The best way to communicate these desires is by setting clear and measurable goals for each employee.

An important key to strategically developing your talent pool is training. Columbia University researchers reviewed 16 case studies of employee training, which revealed that ROI on training ranged from 100 to 5,900 percent. Beyond the outstanding economic benefits, training keeps employee skills sharp and facilitates the adoption of new scalable technologies. It also makes employees feel valued.

Inspire Your Employees

Motivated employees are effective employees, and managers can offer numerous resources to inspire their team members. A Harvard Business School article suggests that many employees are hunting for three traits from their employer:

Equity: respect and fair treatment in areas such as pay, benefits and job security

Achievement: pride in one’s job, accomplishments and employer

Camaraderie: productive relationships with fellow employees

By providing these traits, managers can do their part to instill high motivation over time.

Know What You Don’t Know

Self-awareness is key to your success as an entrepreneur. Recognize the things you don’t know or are not good at, and outsource those to an expert.

One of the most frequent mistakes that Tom sees entrepreneurs making is trying to reinvent the wheel. Taking an example from the payments industry, he often sees marketplace and e-commerce companies trying to build or customize a payments solution without performing their due diligence first.

Do what you do best: Focus on your core business and tap into other people’s expertise rather attempting to fasten a second-rate version of their wheel.

Leverage Technology

In the age of the cloud, if you don’t make technology your friend, you’ll be left in the dust. Software as a Service (SaaS) makes it easy for organizations to leverage technology and increase efficiency. The need for an upfront investment is eliminated. And with everything hosted on the cloud, there is no need for IT resources.

Technology frees up your team to scale by making their work more efficient. The Slack platform is one of the best tools for managing organizational communications, as it facilitates team member chatting, sending files, and keeping everyone up to speed. Tom’s team also uses Trello and Basecamp to keep projects organized and make sure that everyone knows what they should be doing, and the deadline for each deliverable.

Thomas Jefferson may have been one of our nation’s Founding Fathers, but his words of wisdom may not be leading you in the right direction. Instead, find ways to work more efficiently so you can stay focused on the big picture. Hire the right people, nurture, and train them properly to build a lasting company culture. Draw on external expertise, and leverage technology to the best of your capability. Heeding Tom’s advice and following these guidelines within your own business will help put you on the right track to free up your time to focus on the most important thing: managing your company as you scale.

‘Why’ Is The Most Important Question An Entrepreneur Will Ever Ask

April 11

[“‘Why’ Is The Most Important Question An Entrepreneur Will Ever Ask” originally appeared in Forbes and is written by Larry Myler.]

Even though “why” is the most important question entrepreneurs will ever ask, it’s too often the last question they think of asking. When you’re busy focusing on solving a problem and coming up with a product indispensable to others’ lives, your focus is unwaveringly on the “what.”

As Simon Sinek explains in his TED Talk, “Finding Your Why,” every business knows what they do. They make cars, invent cellular devices, sell productivity software or provide a service. Many businesses also know how they do what they do; what makes them better than the competition and what their USPs are. But very few of them can explain why.

What is it that drives your team forward? What causes your business to exist? Why do you get out of bed in the morning? And, more importantly, why should people care? Sinek uses the example of Apple in his talk, as an innovative company that breaks the mold by not only knowing their why, but by beginning every communication with it. Instead of starting with the fact that they make quality computers and mobile devices, they kick off by challenging the way people think.

Finding your why—finding your purpose—is the most important thing you can do as an entrepreneur. Especially if you want to join the echelons of the innovate few companies that stand out from the rest.

Knowing your why isn’t about your USPs, or the fact that your products are cheaper or more luxurious than your competitor’s. It’s more about the psychology and the passion that runs through the veins of your business. We’re all used to seeing companies marketing their products as cheaper, or in some other way better than the competition. It might convince us to buy, but it’s hardly inspiring. The few innovative companies that truly understand their core purpose and manage to communicate that to their consumers are the ones that go the distance.

Just think about Nike. They’ve never tried to compete on price. They don’t really push the fact that their running shoes have special cushioned technology, or that they will go the distance without hurting your feet. Founder and former CEO of Nike, Phil Knight, thought differently, just like Apple. Instead of explaining what the company does or trying to compete on price, he was able to transmit the reason for their very being. Famously talking about how Nike is the “inner champion” and “inner athlete, cheering you on” even when it’s cold and wet and you feel like you can’t take any more. “Just Do It” is so much more than a slogan; it’s an inspiring mantra for employees and customers alike.

Finding your why isn’t only essential for large companies. How do you think cutting-edge startups are founded out of dorm rooms, basements and garages? Or, how can two college buddies, holed up in a hotel room, disrupt an entire industry? Knowing your why is essential for the smallest one-person operation as well as the established global conglomerate.

It’s easy to confuse your why with your passion, and they’re not always mutually exclusive. But loving your work and being enthusiastic about what you do may not be enough of a catalyst to keep other people buying into your business. The leaders behind CarVi, an automobile technology company that designs safety technology for cars, are quite clear about what they do, and they’re even clearer about why. Amy Ching, Senior Data Scientist, can recite her motivation without hesitation: “Zero accidents,” she says. Her team shares a collective understanding of the impulse behind the company’s inventions, to prevent accidents and save people’s lives. This propels their innovation forward—to the point where they are currently disrupting the automotive industry.

Examples of companies obsessed with their why abound. Take fintech leader, YapStone, a payments company dedicated to “changing how the world pays.” YapStone provides complex payment solutions for marketplace companies that enable them to focus on their core business. And they do it because of the belief that their technology can transform businesses. With its own why written on the walls of the 400+ person company, YapStone has also been able to attract top talent from major financial services companies, most recently, adding Sanjay Saraf, former CTO of Western Union Digital, to its Executive team.

Many entrepreneurs never actually stop to think about asking why. And that can be the one thing that stands between a run-of-the-mill profitable company and a worldwide success with fanatically loyal customers. Most prospective customers will hardly be inspired by yet another flashier pair of running shoes or faster service provide. You may run a successful, short-term marketing strategy that way, but will you attract A-Grade talent from far and wide? Will you build a company that strikes envy in the hearts of competitors, inspires employees to join your cause, and forges customer relationships for life? If so, why?

YapStone, a global provider of online and mobile payment solutions for global marketplaces and large vertical markets, announces the strategic hire of Sanjay Saraf, former CTO of Western Union Digital, as the company’s Chief Technology Officer. In his role, Saraf will lead YapStone’s technology organization and manage product engineering, infrastructure and operations, information security, research, development, and innovation as the company expands its digital payments product platform to power online marketplaces globally.

Prior to YapStone, Saraf was Chief Technology Officer at Western Union Digital where he led product engineering focused on digital transformation. In his tenure at Western Union, Saraf built a new digital product engineering organization from the ground up in San Francisco and oversaw technology strategy and development of digital platforms. As the lead, Saraf’s teams built a platform to power global P2P money transfer products delivering billions in payment volume in over 200 countries. He led development of a number of major initiatives for the company, including a complex, proprietary fraud management system, a digital payments platform to support major global funding methods, a global payout platform to connect over 2 billion bank accounts and digital wallets, a massive Hadoop big data platform, and consumer-facing web and mobile apps in over 50 countries. Saraf was also instrumental in leading Western Union’s Omni-Channel product development (digital kiosks and mobile apps for retail locations) and new product innovation, including Blockchain technologies and API platforms for integrating financial services into social media and messaging platforms.

As YapStone’s Chief Technology Officer, Saraf joins a world-class management team with proven experience and expertise in the payments industry. “The YapStone team has delivered phenomenal revenue growth and product innovation for our partners over the past few years,” says Tom Villante, YapStone’s Chairman, Co-founder and CEO. “To continue to serve our global marketplace and software partners, it is vital to have a next generation CTO at the helm. With his immense experience and success in building innovative platforms on a global scale, Sanjay is certainly one of our most important executive leadership hires as we expand our team and operations.”

YapStone has received several accolades for its recent growth, including being named to the Forbes’ 2016 list of Next Billion Dollar Startups, as well as named a “Fintech company to watch” in Entrepreneur Magazine.

“The Fintech industry is still on the cusp of what is possible, and I share YapStone’s vision of what can be accomplished in this space,” says Saraf. “As the digital sharing economy continues its rapid global expansion via peer-to-peer marketplaces, YapStone is well-positioned to deliver a truly value-add payments platform meeting the needs of marketplace companies. 2017 is going to be an exciting year for our team as we plan to expand in international markets and power several new verticals.”

How to Create Happy, Healthy Employees

April 03

[“How to Create Happy, Healthy Employees” originally appeared on Thrive Global and is written by Heidi Dietrich.]

The modern work environment has changed a lot during these past few decades. With the advent of technology such as the internet and the rise of prominence of millennials in the workforce, businesses have been forced to change in a number of ways.

Progressive HR leaders are taking note, such as Debra Tenenbaum, Chief People Officer at YapStone, who says, “There’s no better time than now to ensure your company is developing an environment where millennials can thrive”.

Gone are the times when companies could just offer big salaries and comprehensive benefits and then call it a day. The isolated cubicle-based office structure is also fast disappearing, as many of the most innovative companies across all sectors have shown that office layout can have a big impact on employee creativity. Modern science helps to inform modern business, not just in the products that they are able to offer but also in how the corporations themselves should be set up.

Industrial-Organizational Psychology offers a number of intriguing findings, including the foundational principle that happy employees are productive employees. With the goal of expanding happiness in mind, the question is: how can companies create happy, healthy employees? Two easy strategies companies can incorporate to this end are the creation of an open office environment and the encouragement of employee flexibility.

Open Office Environment

One great way in which a company can adapt to encourage happiness among its employees is in the adoption of an open office environment, both literally and figuratively. Open spaces in an office create a sense of unity in contrast to the divisiveness brought about by separate cubicles or office rooms. Office setups that include series of tables facing each other, round tables, or even couches can increase employees’ sense of corporate community, in that everyone feels as though “we’re all in this together”. This arrangement also has benefits for creativity as open spaces help people to feel psychologically more open and encourages communication, which is great for a healthy flow of ideas.

An open office in the figurative sense is arguably even more important to boosting happiness. Open lines of communication between all employees allows people to quickly bounce ideas off of each other. It also serves to rid people of the rigid sense of hierarchy found in more traditional companies, which is useful since it makes employees comfortable in approaching their managers or even the company executives with fresh ideas or insights.

Company meetings, once a month or more, also can be invaluable in getting everyone on the same page in terms of the collective goals that the organization is working towards. People want to feel that their work is valuable and contributes to the whole.

Inclusive meetings can help employees to align with the overall direction of their company, which in turn helps them to see the value of their individual role within the organization. These are lessons that Yapstone has taken to heart. As Tenenbaum says, “Business information helps employees understand how their role can have [the] greatest impact to the business and employees want to know their job matters.”

Flexibility

The modern worker has grown accustomed to increased flexibility at work, and many millennials thrive on it. Employees appreciate both the ability to work from home and the freedom to set their own schedules. Employers appreciate the benefits that they reap from those happier, more productive employees.

Giving people latitude in their work environment helps them to feel a sense of freedom and empowerment that is not possible with mandatory daily office attendance. Additionally, the freedom to work flexible hours (such as 10–6 instead of 9–5) allows workers to set their own schedule and focus their work during the times of day in which they are most motivated, and therefore most productive.

Such flexibility also is important in scheduling employees’ time off. As Tenenbaum puts it, “A flexible time off policy (FTO) allows employees to be responsible for managing their own time off and for fostering effective teamwork through collaboration and open communication, which all impacts employee engagement”.

Naturally, certain industries such as software development lend themselves better to flexible work locations, work schedules, and time off. It may be more difficult to incorporate such flexibility in jobs that are in more traditional fields such as banking or insurance. However, a little bit of freedom here can go a long way, so it behooves companies to try to give their employees as much flexibility as they can afford.

How To Take Your Startup Across The Pond

March 31

[“How To Take Your Startup Across The Pond” originally appeared on Inc. and is written by Jeff Barrett.]

Taking any company across the pond is a risky business, best carried out with a cool head, united team and a lot of research. When it comes to fintech in particular, people tend to be sensitive about their money. Consumers overseas may not be as willing to part with their cash to an unknown entity as they would in the States. Blindly punching in credit card details isn’t common in all parts of the globe.

Plowing into a new market without adequately reading up and seeking local advice is like belly flopping into a bottomless swimming pool. If your startup is showing signs of second phase growth and it’s time to take it international, here are a few things to keep in mind.

Learn the lingo

No one’s expecting you as company CEO to step out of your area of expertise and brush up on your French or German skills, before selling to customers in these markets. But, they are expecting your company to. According to the Common Sense Advisory, 87 percent of consumers who can’t read English won’t buy from an English-speaking website.

If customers can’t understand what you’re saying, they won’t trust you enough to buy it. That goes double when it comes to installing a payment platform, transferring money, or any other area requiring fintech solutions.

UK fintech company, TransferWise, was set up to save individual customers and business owners from paying hefty bank fees and inflated conversion rates when transferring money abroad. Valued at $1.1 billion, with an investor list including the likes of Peter Thiel, Max Levchin and Richard Branson, TransferWise understands the importance of localizing their assets to their target country.

Detecting the right language in the main countries they do business, customers can see the entire version of the website in their own language. This increases confidence by crafting a message that speaks to the audience on a local level, with local currency, date and time formats and images.

Get ready for cultural differences

Many US companies make the mistake of believing that there are no significant cultural differences between the UK and the US. After all, the language is the same, they’re our greatest political allies and they have a similar outlook on life. Okay, so you might fail to grasp every word they’re saying, especially if it’s in a bar. But it’s hardly the same as learning how low you have to bow to your counterparts in South Korea, or the appropriate dress for a business meeting in the United Arab Emirates.

UK/US cultural differences tend to be more subtle, yet equally as important. Take self-promotion, for example, something very common in the US. Companies and people are encouraged to sell themselves and their strengths, tout the prowess of their business and general personal acumen. However, in the UK, self-promotion is not only discouraged, but it’s pretty much taboo. According to Andy Molinsky, writing for the Harvard Business Review, when working in Britain there should be: “No embellishment and certainly no grandstanding. In fact, if self-promotion is an art in the U.S., the corresponding art in the UK is self-deprecation.”

This is important to remember when it comes to crafting your company message, marketing materials and advertising campaigns. WePay’s infamous marketing stunt at a 2010 PayPal conference in San Francisco was certainly memorable and hugely successful.

They blamed their competitor for freezing customer accounts and dropped a 600 pound block of ice with frozen money inside. While this saw a 300 percent increase in weekly traffic, in some parts of the world — the European Union included — this kind of comparative advertising is actually illegal and can lead to hefty fines.

Make use of local resources

Making use of local resources can play a key part in the success of your international venture. In fact, finding out about the availability and incentives provided by local institutions and government before you go should be a vital part of your research strategy. YapStone, a payments provider, processes more than $17 billion annually. Access to assistance and information from local institutions was vital to them when setting up their international office in Drogheda, Ireland.

The company was able to take advantage of new legislation in Ireland that provides a competitive operating environment for Fintech companies. This includes taxation breaks and a low corporate tax rate of just 12.5 percent. They also partnered with regulatory institutions, including the IDA, American Chamber of Commerce and local Chamber of Commerce to get help and support while setting up on a foreign shore.

Know about key legislation that applies to your business

This can take on many forms, so it’s important to examine any and all that apply to your sector. From corporate taxation to employee benefits, consumer protection to data protection laws, you’ll need to be informed. The battle between South Korean Fintech companies and Apple over Apple Pay still continues. As Apple is threatened with legal action for supposedly violating the South Korean Telecommunications Business Act.

Taking your startup overseas isn’t easy, but it’s definitely achievable if you keep in mind the differences between local markets. Make the most of local resources and on-the-ground talent, and make sure you don’t violate any laws or ruffle too many feathers as you continue your path to industry disruption. You want your company to be talked about for all the right reasons, not as a case study of an epic international flop.

Here for the Long Haul

[“Here for the Long Haul” originally appeared in the Business Post and is written by Caroline Allen.]

YapStone has had a presence in Ireland for the past five years, and with key global roles moving to its base in Drogheda, Co Louth, the US fintech firm is increasing its workforce here all the time.

With a presence in Ireland since 2012, American fintech firm YapStone sees itself in this country for the long haul, with key global roles moving from the company’s North American offices to its Irish base in Co Louth.

Established in California in 1999, YapStone was originally processing online rent payments for the apartment rental industry.

In 2011, the company partnered with HomeAway, one of the world’s largest vacation rental marketplaces, to process its electronic payments in the US.

HomeAway’s move into Europe created a requirement for a payments partner there. This led to YapStone opening its international headquarters at a small office in Ballsbridge in 2012.

Having spoken to other companies with experience of foreign direct investment, YapStone made contact with the IDA, which assisted it in moving to the Mill Enterprise Centre in Drogheda the following year.

This 800 sq ft premises facilitated the recruitment of multilingual staff required to service the HomeAway contract and additional business necessitated taking on another temporary building. A lot of research went into the new location, according to Peter Rowan, YapStone’s vice-president of international operations and global customer support.

“A lot of financial companies were moving north of Dublin, going towards Dundalk and the opportunity came to house ourselves outside the capital,” he said.

This was not a wrench for the company as its US headquarters is in Walnut Creek, California, 50 kilometres from downtown San Francisco.

“YapStone didn’t want to be in downtown San Francisco or downtown Dublin. The company ethos is to create opportunities where people live. Drogheda fit in well as it is the same distance as Walnut Creek is from San Francisco,” said Rowan.

September 2016 saw the company relocate Irish operations to a 16,000 sq ft office at the M1 Retail Park, Drogheda, a premises that is, once again, becoming outgrown. At the official opening, IDA support and the talent pool available locally were cited as important factors behind the new investment.

In the coming year, YapStone will process more than $17 billion in payment volumes, as well as operating a robust customer support call centre covering eight languages, 20 hours per day, seven days a week and 365 days a year.

“When I joined the company in May 2016, there were 39 employees. We are expanding exponentially and now have 124 employees,” said Rowan, who worked for Twitter, PayPal, AIB, and Visa International before joining YapStone. The company’s international business has been growing year-on-year.

“Taking payments for vacation rentals, we expect people to take more holidays as the economy picks up,” said Rowan.

“Even during the downturn internationally, we were unaffected as people still wanted to take breaks. We heard more of the term ‘staycation’ but people still went on holidays and our growth and revenue continued to scale,” Rowan said.

YapStone operates in 22 countries and is always exploring new markets and opportunities. Between January 3 and March 3 this year, Rowan hired 52 new staff in Drogheda, with multiple languages across customer support, technical support, risk operations, and financial and legal services.

While there are sometimes criticisms of the levels of fluency of Leaving Cert students going on to study languages at third level, Rowan has little trouble hiring strong candidates.

“We have not had to go outside Ireland and we are seen as an employer of choice,” he said. “We get direct applications all the time and referrals from existing employees. A lot of people we are hiring now are living north of Drogheda and have tired of lengthy commutes – now some of them can walk to work.”

YapStone currently has a number of positions open in IT, customer support, and risk. “It is not just about hiring people, but also retaining them. We are committed to employee engagement and creating career paths,” said Rowan.

“When I interview people, I ask them whether they want a job or a career. We hire people whose goal is to build a career. Our aim is to create a fun place to work with career opportunities.”

Ireland’s corporate tax system is often seen as a key factor in attracting companies.

However, according to Rowan – a native of Birmingham of Irish parentage whose wife is from Mayo – this success is not just about building relationships with the IDA, but also local businesses, chambers of commerce, and the community.

“When I came on board, we became a member of the American Chamber of Commerce, which has been very supportive,” he said.

YapStone’s focus now is on global expansion with a significant Drogheda presence.

“YapStone is here for the long haul. We are already five years in Ireland and are increasing our headcount all the time,” said Rowan.

Leading payments company, YapStone, consolidates global customer support team in European headquarters

WALNUT CREEK, CALIFORNIA (PRWEB) MARCH 27, 2017

YapStone, a global provider of online and mobile payment solutions for global marketplaces and large vertical markets, announced the consolidation of its United States and International call center into one global call center, located in Drogheda, Ireland.

In 2016, YapStone opened a new 16,000 sq. ft. office in Drogheda to support its global expansion with marketplace and software partners and to deepen its commitment to delivering expert customer support. The location will now serve as the company’s global call center.

Under the leadership of Peter Rowan, a 20-year payments and operations veteran formerly with PayPal and Twitter, Ireland will serve as YapStone’s hub to aggressively expand its geographic footprint. As world-class customer support is a critical element of YapStone’s strategy, the company is building a team of 150 customer service experts in Ireland, speaking eight different languages.

“Payments are complicated and we understand that. We believe that it is critical to offer our customers 24/7 support – from experts who speak their language,” said Mr. Rowan, VP of International Operations and Global Customer Support for YapStone. “As a Fintech region known for excellent customer service talent, Drogheda is the perfect location to expand our global call center, centralize our resources and support our partners.”

Recently named a ‘Fintech company to watch’ in Entrepreneur Magazine, YapStone has continued its upward trajectory and phenomenal growth with a forecast to process over $18 billion in payment volume in the coming year.

“The consolidation of our call center operations in Drogheda is an important next step for our company as we continue our relentless focus on being the premier end-to-end payments solution to marketplace and software partners globally,” said Tom Villante, Chairman, CEO and Co-founder of YapStone. “Through our partnership with IDA Ireland, we have found Ireland to be the perfect location for our global call center.”

YapStone is a global provider of online and mobile payment solutions for global marketplaces and large vertical markets. YapStone powers electronic payments for sharing economy marketplaces, such as HomeAway® and VRBO®, and thousands of apartment and vacation rental companies, homeowners’ associations, self-storage companies, and hospitality establishments. YapStone processes over $18B in payment volume annually and has been recognized on the Inc. 5000 list of Fastest-Growing Private Companies for nine consecutive years and named to the Forbes’ List of America’s Most Promising Companies in 2015. YapStone has raised over $110 million from investors including Accel Partners, Meritech Capital and Bregal Sagemount. Headquartered in the San Francisco Bay area, YapStone has additional offices in Santa Monica, California, and Austin, Texas with its European operations in Drogheda, Ireland.

Fintech companies to invest in 2017

March 23

[“Fintech companies to invest in 2017” originally appeared on ForexNewsNow .]

It’s becoming clearer by the day that change is coming, and Fintech companies are the latest fad causing a disruption to conventional financial services. Whether it’s the public’s distrust of banks or the increased use of technology we don’t know, but there’s definitely a shift.

According to a recent McKinsey report, Fintech companies have received $23 billion in funding over the past 5 years. What’s more, the level of investment is increasing every year, as the graph below shows.

In 2015, the amount of funding surpassed $20 billion, which was a 66% increase over 2014’s funding, and you can bet funding in 2016 was even greater. This shows that there is rapidly increasing interest in the Fintech industry, even by the traditional banks. It also shows that there is a valuable opportunity for anyone seeking for an investment opportunity.

However, startups in general are usually risky since almost 90% of startups fail. Investing in startups is a bit like investing in penny stocks – the returns could be amazing, but the risk is also high. Plus, you have to think about people’s apathy toward trusting their money to an online company, which puts Fintech companies at a difficult position.

Nevertheless, there can be no reward without risk. The key is to be really smart with your investment and consider the risk to reward ratio. The idea that Fintech companies are becoming more popular, so much so that they are being listed on exchanges, and that they have backing from renowned companies is a good sign. So, we’ve done the heavy-lifting for you and here are some great options you might consider investing in this year.

Roboadvisors

These are Fintech companies that use automated trading to invest their clients’ investment into financial markets. Unlike regular investment avenues like hedge funds and mutual funds, roboadvisors are more accessible even to less wealthy individuals and have lesser fees. These and many more advantages make roboadvisory services highly sought after, and there are several companies blazing the trail:

Wealthfront

Founded in 2008, Wealthfront was among the very first companies to utilize software to participate in financial markets. It was a difficult time, obviously, being so soon after the global recession, and it was difficult getting investors or clients. Even by 2013, the company only had $97 million in management, but impressive growth at 450% was enough to entice investors and clients.

Soon afterwards, investment from venture capital (VC) companies like Greylock Partners and Benchmark Capital pushed the total invested capital close to $130 million. The amount of assets under management (AUM) is truly impressive, at $4.6 billion. The hype and publicity around the company is bound to invite more clients and investors, making Wealthfront a prime investment opportunity.

Betterment

The story of Betterment is similar to that of Wealthfront, and so is their business model. Betterment has more funding and AUM, though, with the latter being above $7 billion. This makes Betterment a more solid investment opportunity, but the amount of funding means you would need to put in a larger investment.

Money Transfer

Traditional money transfer services like the Western Union are also under threat from Fintech companies. PayPal was perhaps the first such company, and you could buy PayPal shares if you wanted. Recently, though, there have been more companies offering similar services, and these are the ones to watch:

Adyen

Considered a ‘unicorn’, Adyen got a $2.3 billion valuation in 2015 following a doubling of its revenue that year to $350 million and processing payments above $50 billion. With headquarters in Amsterdam and offices in various other locations around the world, Adyen also boasts an impressive client base including Facebook, Uber, KLM and many more impressive names. Experts speculate that the company may be headed toward an IPO, which places Adyen among the top Fintech companies to invest in this year.

Stripe

Offering similar services to those of Adyen, Stripe is another interesting company worth investing in. Stripe also sports an even more impressive list of clients, including both US presidential candidates in last year’s elections as well as Target and the NFL. The list of Fortune 500 companies making use of Stripe’s services pushed the company’s valuation to $9.2 billion in 2016, which was more than the $5 billion valuations in 2015. This is definitely a contender targeting the behemoth that is PayPal due to its expansive services including bitcoin payments.

Personal Finance

We already mentioned the public’s distrust of banks before, and Fintech companies are taking advantage and filling this gap.

Lending Club

Instead of jumping through hoops at a bank to prove your credit-worthiness before they offer you a loan, why not get it from another person. This is Lending Club. For someone seeking a loan, they simply have to advertise that they need a loan and for what purpose. An investor will then offer the loan if they like the borrower’s idea. Already, the company is listed on the NYSE and their services registered and regulated by the SEC, making the company legitimate. Lending Club provides an opportunity to invest directly into a business idea, and make a return from the interest earned.

SoFi

Initially started to help students with less costly loans, it has grown to become a major personal finance company. The value of loans issued by 2016 totaled $12 billion, and the company is set to become a serious competitor to regular banks. SoFi also has billions of dollars in funding from various investors, and it is rated by Moody’s with a triple-A rating, making it a very trustworthy investment.

Other Fintech Companies Worth a Look

There are plenty of other Fintech companies which are also worth investing in such as YapStone, Braintree, Commonbond, Addepar, and Kabbage. You should also be on the lookout for more Fintech startups near you because the earlier you invest in such a company the better the returns would be.

FinTech Companies Firing Up The Mobile Payments Market

March 23

[“FinTech Companies Firing Up The Mobile Payments Market” originally appeared on Let’s Talk Payments and is written by Sofia.]

The FinTech industry in recent years not only attracted attention from traditional financial institutions and disrupted certain sectors, but also made a significant transformation in consumers’ minds. Our expectations went so far beyond of what was really available and all of it was because FinTech ‘spoiled’ the customer.

One wouldn’t imagine not having an option to make a mobile payment as there are tons of options to choose from (which makes it even harder). In fact, in 2016 total mobile payment transactions are expected to reach $27.05 billion, with users spending an average of $721.47 annually. Total mobile payment sales will rise faster than average spending per user in 2016 because of the growth in the number of overall users of the technology.

Almost every other month a tech giant introduces its mobile wallet or other integrated payment solutions for merchants across platforms and devices. To understand how dense the market is, here are some of the companies offering integrated solutions for payments, in particular, mobile payments. So if you are looking for a seamless experience (whether as a business or individual) with mobile-shopping, consider having one of those solutions installed.

The obvious one, Square, offers POS solutions to take care of digital receipts, inventory, and sales reports, as well as provide analytics and feedback.

Dwolla is a free web-based software platform allowing users to send, receive, and request funds from another user.

iZettle, a leading mobile payments company, offers small businesses portable point of sale solutions and free sales overview tools.

LoopPay is an m-commerce platform provider that enables retail consumers to pay with their mobile phones. Samsung acquired LoopPay in 2015.

Stripe is a technology company that allows both private individuals and businesses to accept payments over the Internet.

As we mentioned, the list in not exhaustive. However, it already demonstrates the level of concentration of similar services in the market. As with the story of mobile wallets, payments solutions providers could end up on their islands hitting the wall of expansion. We have also been looking at companies specifically focusing on mPOS, which demonstrates the wide range of options for businesses to choose from.

How Thinking Smaller Helps FinTechs Scale

March 08

[“How Thinking Smaller Helps FinTechs Scale” originally appeared on PYMNTS.]

There’s more to thinking small than one might think. The key is this: don’t think “small,” think “focused.”

In fact, when it comes to FinTech companies, thinking “small” by focusing and serving a relatively small number of huge markets may provide the best opportunity to drive more impactful revenue with sustainable and profitable growth.

David Weiss, president of YapStone, shared with PYMNTS some big misconceptions about market specialization.

The belief that focusing on particular market segments may not be a great way to scale a company just isn’t true, he explained.

“From that perspective, even though YapStone is focused on a small number of verticals, the opportunity in each is quite significant, as each vertical is hundreds of billions and, in some cases, trillions of dollars in size,” Weiss said.

He noted that while other companies in the payments space have a product offering that is an inch deep and a mile wide, YapStone’s approach for the most part is about being several miles deep and several feet wide in any given vertical market. This allows the company to offer integrated, end-to-end payments solutions for specific markets.

“The other misconception is that focusing on vertical markets may seem easier, but it’s really not. Payments are very complicated, whether you’re a large global company or a smaller startup company,” he stated. “It’s very easy to underestimate the complexity of what’s required to scale a payments company, regardless of your go-to market strategy.”

Weiss went on to say that “very few payments companies have the people, the expertise, the technology and the infrastructure to sufficiently address these complexities that span across onboarding (auto-decisioning different types of merchants globally), risk management, pay-in methods, pay-outs, security/data protection, customer service, regulatory, licensing and compliance requirements. Most payments companies that focus on authorization, settlement, simple APIs, pay-outs, etc., eventually become commoditized.”

Navigating the FinTech Waters

For new FinTech entrants, Weiss’s advice is to ensure that their company has a unique offering, supported by a strong value proposition.

When YapStone made the decision to focus on the apartment rental market back in 1999, Weiss said the company was fixated on differentiating their payment solution from other companies in the space. Back then, even though PayPal was just beginning to gain traction and online banking was quite prevalent, the apartment rental market was still dominated by paper checks, Weiss explained. Property managers also used an incredibly archaic system that made it difficult to deal with rent, security deposits and payment collections.

This is exactly where YapStone identified the opportunity to solve a real problem for property management companies and build long-term relationships. Weiss explained that YapStone offered integrations with major property management software companies, making it easier for property managers to accept online payments and eliminating the hassle of processing paper checks.

YapStone applied that same discipline when it entered the vacation rental vertical in 2006, eventually building an end-to-end payments solution serving that particular market.

Weiss also noted the importance of thinking differently and fostering partnerships across the industry.

“Because of the integrations and interconnections between all the various constituencies from the card networks, to the issuers, to all the other financial institutions, to the marketplaces and other business development partners, it’s almost impossible to do this alone,” he explained. “FinTech companies must partner with this ecosystem to really accelerate growth and conquer some of the unique obstacles along the way.”

The decision to avoid the one-size-fits-all model and instead focus on specific, large vertical markets can enable FinTechs to deliver faster, more sustainable and more profitable growth, Weiss said.

“What we’ve tried to do is solve complex payments problems and build real integrations with our partners in our markets, and that strategy has served us extremely well,” he added.

Over the years, YapStone has expanded into new verticals, including self-storage and homeowners’ associations, but Weiss said within all of those markets, the company follows the same strategy of solving specific problems for these large verticals by building specific functionality for their partners.

Preparing for a FinTech Future

When it comes to what’s next for the FinTech landscape, Weiss said he expects that there will continue to be a bifurcation between the strong and the weak, the haves and the have-nots, because the cost of doing business and the stakes are so high.

Due to the segmentation between some of the larger public companies, earlier-stage players and those that fall somewhere between, there will likely be FinTech consolidation and failures in the coming years.

“A lot of companies just aren’t going to make it for one reason or another, and those companies in the middle are going to differentiate and segment themselves in one direction or another,” he said. “You’re going to see a widening of the gap between the more successful, high-growth, high-margin, highly integrated players in the payments space, and those earlier-stage companies and those companies who have not invested in the requisite infrastructure.”

How Fintech is Bridging the Gap with Marketplace Companies

February 28

[“How Fintech is Bridging the Gap with Marketplace Companies” originally appeared on Yahoo Finance.]

Online marketplaces have become commonplace in the age of the sharing economy. Renting out vehicles, ordering food, sharing rides and finding temporary help. If you can think of it, you can bet a startup already exists.

When making purchases, most consumers punch in their credit card details with complete confidence these days. Millennials now make more than 54 percent of their purchases online, and many never give a second thought to the payment platforms powering the transactions underneath it all.

As marketplace companies evolve and start attracting more and more clients, the need for robust payment solutions has become increasingly important. Platforms like Uber and AirBnB find themselves under the spotlight from industry auditors, as well as a target for fraudulent transactions, which means they have to demonstrate that they can account for the security of their customer transactions.

The Need For Secure Payments

Considering the breadth and depth of the financial responsibility involved, some of the major players in the peer-to-peer economy could actually be considered financial services companies rather than marketplace.

“AirBnB has a separate company that is a payment company — as in, it is a fully licensed payments company that only handles payments,” explained Tom Villante, CEO of fintech payment company, YapStone.

Not all marketplace companies are as big as AirBnB or Uber, nor do all wish to assume full responsibility for their financial operations. But, they must be able to provide a secure platform for consumers. The company takes care of the payments processing for customer transactions, but they also assume a large part of the risk, appealing to marketplace companies that want to focus on their core business, while ensuring security and legal compliance.

What Does YapStone Do?

YapStone offers end-to-end payment technology solutions, as well as expert support throughout the lifecycle of the electronic transaction.

Fighting fraud is a daily problem and with each new company that springs onto the scene, comes just as many ways of committing fraudulent transactions. “Before we got into marketplaces, we had three people in risk — now we have 70,” said Villante. A huge focus of YapStone’s efforts is on “building and integrating next generation fraud solutions.”

YapStone currently processes more than $17 billion in payments every year. The company has been recognized by Inc. as one of the 5,000 fastest-growing private companies. Additionally, YapStone was on Forbes’ list of America’s most promising companies in 2013 and 2015.

Complex Payment Solutions For Marketplace Companies

In marketplaces, the payments process is particularly complex. “When you have a marketplace and you’re bringing together essentially thousands and thousands of sellers of goods or services, with potentially millions of consumers, the payout is much more complex,” Villante stated.

Some of those complexities show up in the form of chargebacks, whereby the seller is forced to return the funds to the buyer. Use of fraudulent credit cards is also a considerable issue and fraudsters are increasingly creative in finding ways of manipulating the system.

When dealing with global customers, companies also have to comply with varying legislation. Charging for certain taxes and ensuring compliance with local competition laws.

Villante explained, “There are a lot of marketplaces that got big very fast that have no desire to be payments companies but want to monetize payments.” After 17 years of working in the payments industry, YapStone has gotten pretty good at spotting fraud and assessing risk.

“The more you know a vertical, the more you understand the risk profile,” Villante concluded. “By any measure, our losses on a basis-point standpoint are incredibly low by industry standards.”

If you’re looking for cool fintech startups and access to top financial institutions, and are sick of attending stuffy corporate conferences, the Benzinga Global Fintech Awards is the event for you. From its first year in 2015, the competition grew to over 250 applicants and over 500 attendees in 2016.

12 Top Fintech Companies to Watch

February 28

[“12 Top Fintech Companies to Watch” originally appeared on Entrepreneur.]

Financial technology (or “fintech”) has become an extremely trendy industry for startups because of its high growth potential and opportunity for nearly endless disruptive innovation. In fact, these scrappy companies have the potential to take away $4.7 worth of revenue from traditional financial services, according to Goldman Sachs.

Fintech companies are represented in account management, lending and financing, payment processing, and financial assets and capital markets, but what makes them so attractive for small and large businesses is their focus on the customer’s needs. Financial information and processing is readily available, which allows for a business to handle important matters quickly, providing consumers with a means to conduct instant, frictionless, digital transactions at an unprecedented speed.

Venture capitalists are taking notice of the fintech explosion; $23 billion of venture and growth equity has been deployed to these over the last five years, according to a report by McKinsey. Over $150 billion could be invested in fintech companies over the next 3-5 years, according to PricewaterhouseCoopers.

The mark of a fintech company that will truly succeed all boils down to audience acquisition. Remember, 90 percent of startups fail – and fintech is no different. In fact, one might argue that fintech companies have a much more difficult road than most startups because their technology specifically deals with the transfer of money, which everyone is very sensitive about. One wrong move on the startups part and they might just lose credibility forever.

In light of all this, there are a number of fintech startups that are knocking it out of the park and rising to the top because of their abilities to identify a niche, build a truly innovative technology for them, and craft a user experience that inspires confidence. Here are the top 10 fintech companies to watch this year:

1. Stripe

Founded by brothers Patrick and John Collison, Stripe is a competitor to another fintech company — Paypal. The Irish technology company, operates in over 25 countries, allowing both private individuals and businesses to accept payments over the Internet.

Stripe recently raised $150 million in November of 2016 in a deal co-led by General Catalyst Partners and CapitalG, which valued the startup at $9.2 billion. This almost double the $5 billion valuation it had achieved in 2015. Stripe is backed by Sequoia Capital, Andreessen Horowitz, and PayPal co-founders Peter Thiel and Elon Musk.

Stripe started off serving smaller customers. In 2016 Fortune 500 companies started seeking Stripe services. “This year, Target, SAP, the NFL, and both presidential campaigns used Stripe’s services to power at least some of the payments processing they build into their apps and websites,” says Stripe CFO Will Gaybrick.

Related: 25 Payment Tools for Small Businesses, Freelancers and Startups

2. YapStone

YapStone, founded in 1999, has focused on providing end-to-end payment solutions to multi-billion dollar sharing economy marketplaces and vertical markets, such apartment and vacation rentals. “Our strategy is to be all things payments for the largest marketplaces in the world,” says YapStone CEO Tom Villante.

This focus has contributed to YapStone’s accelerating growth in staff, revenue and payment volume; the company processes over $15 billion in payment volume annually. YapStone’s revenue has increased over 7-fold since it raised $50 million with Accel Partners and Meritech Capital Partners in 2011. YapStone has raised a total of $110 million since inception.

3. Braintree

Braintree, which is a subsidiary of PayPal, is a company based in Chicago that specializes in mobile and web payment systems for ecommerce companies. In 2013, PayPal acquired Braintree in an all-cash deal worth $800 million. Braintree’s technology is used to process credit card payments on over 3,000 e-commerce sites, including Fab.com, Airbnb, Uber, Hotel Tonight, LivingSocial and the Angry Birds games.

Braintree was one of the first fintech companies to focus on mobile commerce. “The shift to mobile is coming and it is coming very quickly,” said Braintree CEO Bill Ready. Of the $4.5 billion in sales that the company processes each year, $1 billion of those are on mobile phones.

Transaction volume on its platform has grown 25x, nearly tripling every year since it was acquired. In 2015, the company said it surpassed $50 billion in payment volume.

4. Adyen

Adyen is a technology company based in Amsterdam that provides businesses with a single solution to accept payments anywhere in the world. Adyen serves more than 4,500 businesses including Facebook, Uber, Airbnb, Netflix, L’Oreal, Spotify, Dropbox, Evernote, Booking.com, Vodafone, Mango, Crocs, O’Neill, SoundCloud, KLM, and JustFab.

Ayden was recently named as a leader among Global Commerce Payment Providers. Adyen’s 100 percent growth rate makes it a top IPO candidate. In 2015, the company almost doubled revenue to $350 million, with over $50 billion in payments processed. This gives the company a $2 billion-plus valuation.

5. Lending Club

Considered a pioneer in the fintech industry, Lending Club is a US peer-to-peer lending company, headquartered in San Francisco, California. The world’s largest peer-to-peer lending platform, Lending Club operates an online lending platform that enables borrowers to obtain a loan, and investors to purchase notes backed by payments made on loans.

Lending Club has gone from birth to IPO while arranging $7.6 billion in financing, and now lending to small businesses. Lending Club stated that $15.98 billion in loans had been originated through its platform in 2015.

6. Addepar

Addepar was co-founded by Joe Lonsdale and Jason Mirra in 2009. It is an investment management technology company that offers an integrated financial software platform. Its software is used by single and multi-family offices, wealth advisors, large financial institutions, and endowments and foundations.

With 97 percent year-over-year growth, Addepar reports more than $500 billion in assets on its platform. The company recently announced a partnership with Salesforce.

Addepar won the 2016 CODiE Award for Best Financial Management Solution.

7. Commonbond

With student loan debt being a real issue, Commonbond is a marketplace lender that lowers the cost of student loans for borrowers and provides financial returns to investors. The company refinances graduate and undergraduate student loans for graduates, saving the average borrower over $14,000 over the life of the loan.

The company was founded in 2012 by David Klein, Michael Taormina, and Jessup Shean. In 2016, the company raised $300 million in debt to loan out to prospective borrowers. Since its beginning, the company has raised around $1 billion.

What makes Commonbond attractive is its technology, which simplifies and speeds up the process of getting a student loan, and a business model that puts customer service front and center. CommonBond has refinanced more than $100 million worth of student loans, and projections going into 2016 were for more than $1 billion.

Related: 8 Companies Making Payment Handling Easy

8. Kabbage

As it becomes harder to secure loans from a bank, Kabbage provides funding directly to small businesses and consumers through an automated lending platform. The company was founded by Rob Frohwein, Marc Gorlin, and Kathryn Petralia in 2009, and is headquartered in Atlanta, Ga.

Kabbage’s small business product is a line of credit up to $100,000. It is based on a number of data factors, including business volume, time in business, transaction volume, social media activity, and the seller’s credit score. The company lent more than $1 billion to small businesses in 2015.

In 2016, Kabbage raised $135 million, giving it a valuation of $1 billion. In 2016, Kabbage was named to CNBC’s annual Disruptor 50 List and was named to the Inc. 500 list for the second year in a row.

9. Robinhood

Founded in 2013 by Vladimir Tenev and Baiju Bhatt, Robinood is a smartphone app that allows individuals to invest in publicly traded companies and exchange-traded funds listed on U.S. exchanges without paying a commission on your smartphone.

As of March 2016, it has nearly one million customers and has raised a total of $66 million in venture capital funding.

10. Wealthfront

Wealthfront is an automated investment service firm founded by Andy Rachleff and Dan Carroll in 2008. Wealthfront is part of an emerging financial niche known as “roboadvisors.” The company aims to upend the core financial advising business provided by traditional investment companies that have been using employees for decades to communicate advice about stocks and mutual funds.

The company started 2013 with $97 million in assets under management and grew by 450% in one year. As of December 2016, Wealthfront had more than $4 billion of assets under management. The company has a valuation of $700 million.

11. SoFi

SoFi was founded in 2011 by Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady. The company is an online personal finance company that provides student loan refinancing, mortgages and personal loans.

The firm’s lending algorithms ignore strict credit scores used by banks in favor of practical indicators of ability to pay. High Earners Not Rich Yet, known as HENRYs, are its main customer base. As of 2016, SoFi has funded more than $12 billion in total loan volume and has 175,000 members. The company now plans to compete directly with traditional banks. “We feel very confident that in 2017 you’ll be able to have a Sofi bank account … with a debit and/or credit card,” says Cagney.

12. BillGuard

Two things credit and debit card users hate — fraudulent charges and hidden fees. BillGuad operates as a personal finance security and productivity company to keep its users aware of their financial matters. Its mobile and website application scans credit card and debit card transactions, alerting users to irregular activity such as scams, billing errors, fraudulent charges, and hidden fees.

Founded in 2010 by Yaron Samid and Raphael Ouzan, the company has flagged over $60 million of suspect charges for its users. In 2015, BillGuard was acquired by Prosper Marketplace for $30 million. BillGuard was named One of the Top Online Banking Innovations of all Time by Market Consensus and recognized as a Top 10 Tech Company by American Banker.

How Entrepreneurs Can Attract And Retain Talented Millennials Who Prioritize Health

February 21

[“How Entrepreneurs Can Attract And Retain Talented Millennials Who Prioritize Health” originally appeared on Forbes and is written by Melissa Thompson.]

It’s no secret that as a society we’re more conscious about our health than ever before. While technology may not always be our ally in allowing us time to get to the gym — interminable conference calls, Skype chats and emails — we do have greater access to information. Millennials are more aware than their parents were about the dangers of smoking and drinking. We know the types of food we should avoid and that CARBS is a four-letter word. We also know that working in an uninspiring or toxic environment can be detrimental to our health.

Harmful workplace factors include: having unsupportive colleagues, an excessively demanding boss, or suffering constant ill-treatment increases risk of heart disease, depression and high blood pressure. These undesirable conditions are not exactly the perks you look for during a job hunt.

So, if you’ve let your standards slip when it comes to treating your employees, or your HR policies are a little rusty, take note. It’s hard to attract and keep hold of top talent, especially millennial top talent that has gotten used to changing jobs, working on their own projects and prioritizing their health over their career. Seeing as millennials will make up 75 percent of the workforce by 2025, if you’re not implementing policies to attract this dominant (and demanding) demographic, you should be. Here are some healthy ways to attract top millennial talent.

A flexible time off policy

Some of the most forward-thinking companies are starting to think creatively when it comes to attracting millennial talent. The leadership at progressive payments company, Yapstone, who made the INC 5000 List of Fastest Growing Companies nine years in a row, are firm believers in working smart. Seeing as you’re more productive at work after taking a vacation, they offer a Flexible Time Off (FTO) policy to all workers.

Flexible time off doesn’t mean offering unlimited vacation, although there are some companies, like Mammoth, that have tried it. But it does mean giving your employees the trust and freedom to manage their own time off. Rather than having to plan their ten days a year in advance, they can use them as they feel and take a break when they need to recharge their batteries.

“At the end of the day,” says tax lien investor Ted Thomas, “responsible workers who are satisfied with their jobs will probably take no more time off than they would with standard vacation time.” Flexible time off is more valuable for the message it conveys than the time off in itself. It shows trust in your employees and recognition that their personal lives matter as well. It also creates a sense of empowerment for millennials that like to be in the driving seat.

Work from home days

A 2016 Harvard study concluded that the average American would gladly take an 8 percent dip on their earnings to be able to work from home. Some of the workers surveyed were willing to shave as much as 21 percent off their salary to work from their living rooms. As technology provides us with the tools to work from anywhere, telecommuting is on the rise. In fact, according to Gallup, as many as 37 percent of the US workforce has done so from their home or mobile office at some point.

Allowing your millennial employees to work from home is another easy and effective way of attracting them to your company. Instead of the time spent commuting, they get extra leisure time outside of working hours. Which means they can take a pilates class, go for a run, spend more time with their families, or hang out with friends.

On the job training

The average American spends around one third of their life at work (between 25 to 30 years to be more precise). Which is an awful lot of time to waste on an unfulfilling job. Millennials like to be creative and to be given a challenge. So, the best way to lose your all-star employees, or turn away prospective ones is by making them follow a strict set of mundane tasks every day. Lowell Crabb CFP, founder of Drive Wealth Management, recently explained to me that helping millennials stay motivated at work is all about helping them have meaningful life experiences while there. “This can be challenging,” he said, “but not impossible. Tying compensation and work goals to positive social impact projects is one of the more popular ways my clients have had success helping millennials feel valued, and prepared for retirement at the same time.”

A strong emphasis on on-the-job training and room for growth is important. Not just vertically, but within the position they were hired for. At least 25 percent of YapStone’s positions are filled with internal candidates. This proves to ambitious millennials that they can carve out a career path that molds around their skills and preferences. They can see clear potential for career expansion. Job satisfaction is a key factor to a healthy life, so providing constant stimulation and on-the-job training is vital.

A few perks here and there

Everyone’s heard about Silicon Valley’s massage rooms, free snacks and bring-your-dog to work days. Some of these initiatives might seem a little absurd, but they have proven to be highly magnetic when attracting top millennial talent. While Generation X was taught to value compensation and control above all, millennials place more importance on how working in a certain role makes them feel and impacts their life.

Google’s corporate culture, for example, attracts millennial talent from all over the globe. From a selection of restaurants and gyms, to free haircuts and dry cleaning, Google is a company known for investing in its employees’ well being. And it is consistently rated as one of the top places to work. Nap pods and foosball may not be your thing, but think of other perks that would work well with your corporate culture. Sometimes the little details can make a big difference.

As companies like YapStone and Google have proven, attracting top millennial talent isn’t necessarily about offering a fat paycheck. Learn to understand the millennial mindset and the life factors they value most, such as their health and career satisfaction, and you’ll have the A-players knocking down your door.

YapStone announced a definitive agreement to divest YapStone’s ParishPay™ merchant portfolio to Liturgical Publications (“LPi”), a Catholic stewardship and communications company. The sale is consistent with YapStone’s focus on providing end-to-end payment solutions to global marketplaces and large vertical markets. ParishPay customers will be transitioning to LPi’s WeShare service, the largest electronic-giving provider serving the Catholic Church both in the US and abroad.

“The agreement to divest ParishPay to LPi is mutually beneficial for all involved,” said David Weiss, YapStone President. “Our ParishPay customers have relied on our services to maintain their online giving programs, and our team is committed to partnering with LPi to support each parish through this important transition.”

Effective as of 2/17/17 all customers have a dedicated LPi Engagement Manager that will support them and their parish donors. “We’re confident this will be a seamless transition process for customers,” said Joe Luedtke, LPi President. “The upgrade to WeShare will be fully automated and require no action by either the parish admin or donor.”

YapStone And Making Marketplaces Manageable

February 03

[“YapStone And Making Marketplaces Manageable” originally appeared on PYMNTS .]

These days, there is literally an online marketplace for every need. Whether it be workers, office space, rides, vacation homes, food delivery, graphic designers or temp workers, the list extends to almost any and all imaginable services that can be collected digitally. And while these marketplaces are all different from each other, they mainly share a common ground in that they didn’t go into business in the hopes of becoming a payments or financial services company.

As marketplaces take off with millions of transactions between hundreds and thousands of buyers and sellers, they may become a magnet for fraudsters, industry auditors and government oversight. Tom Villante, CEO and cofounder of YapStone, knows this story all too well, which is why his company specializes in handling the burden of financial services, allowing the marketplaces to focus on buyer/seller engagement.

Some of the go-to names in the sharing economy may be known for giving rides or renting properties even though they could also be fairly described as financial service firms.

“Airbnb has a separate company that is a payment company — as in it is a fully licensed payments company that only handles payments. Uber could also be considered a payments company; a lot of what they do is payments-related,” Villante said.

Villante said that the Airbnbs and Ubers are the exceptions to the rule, though — the vast majority of marketplaces either can’t (or won’t) take on the challenge of going deep into financial services. That’s why he founded YapStone, which offers its partners access to its full-stack payments platform that does the risk underwriting, onboarding and payments processing for big-ticket payments — including recurring ones.

Villante said that it’s been an interesting journey for YapStone — one that started out in apartment rentals and helping making digital payments possible for tenants who found themselves tethered to their checkbooks to write (big) monthly rent payments. From there, the journey moved on to marketplaces — with an unsurprising specialty in real estate — where he also found himself on the front lines fighting fraud.

“Before we got into marketplaces, we had three people in risk — now we have 70, in addition to material ongoing financial investments in building and integrating next generation fraud solutions,” he said. “We have also developed a global view of the customers who transact in our verticals. This helps us separate those customers that are known, safe and operating within pattern from customers that require closer evaluation.”

YapStone also has an increasingly well-known client list, processes billions of dollars a year in transactions and is averaging annual growth in the 40 percent range. This is a trend their founder said he expects to continue given YapStone’s remit as a marketplace that offers their partners freedom from being a payments company.

The Incredibly Complex World of Marketplace Payments

In the world of regular payments, a single consumer goes into a merchant or service provider, receives their goods and goes on their merry way — and the payments process is straightforward and fairly simple, noted Villante: “Auth, capture, settle.”

“When you have a marketplace and you’re bringing together essentially thousands and thousands of sellers of goods or services, with potentially millions of consumers, the payout is much more complex.” That complexity abounds and traverses in some unexpected directions. There are the chargebacks and fraudulent transactions to worry about — and those, Villante noted, are considerable and ever-changing.

But then there are things that are less attention-grabbing — like paying out various applicable taxes or making sure various insurance fees are covered. This means that payments going in and out need to be split and distributed in a wide variety of configurations — and Villante noted that in these cases, the money is going through the marketplace, which means the marketplace is responsible for managing all those split payments on its own and dealing with vast sums.

“They are running into money transmitter license territory at some point — which may mean, many years and many millions of dollars for a money transmitter to effectively comply,” Villante said. Or, he noted, YapStone can take over payments, take over chargeback responsibility and make sure that all those split payments are automated and off the marketplace’s plate.

“There are a lot of marketplaces that got big very fast that have no desire to be payments companies but want to monetize payments.”

YapStone lets their clients do that, he noted, which means the payments process goes from being a net loss to a get-profit center. That is good news, he said. Better news, though, is opting out of the unending battle with fraudsters.

Fraud’s Ever-Evolving Presence

“Nothing wrecks a marketplace like fraud. If it becomes rampant, that is a really, really bad thing,” Villante noted.

But attempted fraud is more or less everywhere.

“We have seen so many different schemes,” Villante said of YapStone’s longtime fight against fraudsters on the marketplace’s services.

Some were expected. Collusion schemes where fake merchant accounts are created on marketplaces as mules through which to drain stolen card accounts are an ever popular favorite. On vacation rental sites, posting a photo of a fake property at a too-good-to-be-true price is also a classic. Then, he noted, there are the somewhat more brazen and less expected fraud cases. People who use stolen credit cards to rent houses — and then actually go and stay in them — has been somewhat eye-opening.

Looking at the various types of fraud has also been educational. Once it became clear that even people who steal credit cards like to sit by the beach, it was yet another factor that went into the underwriting and fraud rules engine — since people don’t tend to book vacations with stolen credit cards much more than a day or two in advance.

Traditionally, the war on fraud was fought by identifying abnormalities and patterns of data in motion (authorizations and settlements) and were required to act quickly to block the fraud before the criminal monetized the vulnerability. Winners in today’s war have evolved to using machine learning and artificial intelligence tools driving complex models focused on looking at millions of data elements for both data in motion and data at rest (past processing behaviors, chargebacks, device fingerprinting, geolocation, identity verification) to predict where the next fraud is likely to happen, before it happens.

That decision engine, noted Villante, is an important part of YapStone’s offering since it allows them to essentially take on the risk of the marketplace transactions — and when chargebacks occur, YapStone is the one on the hook for them. But this doesn’t happen often, said Villante, because YapStone has seen a lot of schemes and is really good at spotting fraud. Particularly, he said, because the company is selective about its client base, isn’t recruiting any merchant willing to pay the fee and works in the verticals it knows and where it is confident it can provide the best services. “We go very deep with the fraud tools for our customer. We’ll tailor to very specific needs because we’re taking the risk, and thus we’re highly incented to really know it inside out.”

“The more you know a vertical, the more you understand the risk profile. By any measure, our losses on a basis-point standpoint are incredibly low by industry standards,” Villante said.

YapStone has been around for a long time, so it’s had a very long time to understand that risk profile — at least in the verticals it works with — which means it really knows its fraudsters. YapStone also knows its marketplaces — and that it has rides to connect, houses to rent and crocheted hats to get to people who want them. And given YapStone’s growth rate for the past several years, it seems the company also knows that given a choice, the vast majority of firms will opt out of having to become payments companies if someone else can offer them a better option.

4 Things Top Tech Companies Are Doing to Attract Millennials to Their Companies

January 12

[“4 Things Top Tech Companies Are Doing to Attract Millennials to Their Companies” originally appeared on The Huffington Post and is written by Chirag Kulkarni.]

When it comes to attracting top talent, companies used to be able to offer a competitive salary and a big benefits package and that was enough to keep most people happily employed until retirement.

But successful conglomerates like GE, PwC, and Mars recognize that it takes more than just money to attract and keep the cream of the crop talent in the modern market.

That’s why they invest in their staff routinely.

Today, top tier employees have more options than ever, since technology has completely changed the face of the workforce.

The best employees can work for online start-ups with extreme flexibility, start their own company, or work for big companies that offer traditional benefits like vacation and sick pay, as well as extras like flexible job sharing and the option to work from home.

But more than anything else, the catalyst for the shift in employee attraction and retention strategies is the increase in millennials in the workforce.

Millennials (those born roughly between the years of 1981-1997, give or take a few years depending on who you ask) expect more from their careers. They watched as the retirement benefits awarded to their parents’ and grandparents’ generation went by the wayside and collectively decided that if they were going to spend their time working for an organization, they would ask for more than just a paycheck and security.

With the future in mind, progressive HR Leaders are making some very exciting changes to make their companies more attractive to the millennial workforce. “There’s no better time than now to ensure your company is developing an environment where millennials can thrive,” says Debra Tenenbaum, Chief People Officer at YapStone.

This past year, YapStone (a payment technology start-up) made the Forbes List of Next Billion-Dollar Startups, as well as The Deloitte Fast 500 list; the company was also included in the INC 5000 List of Fastest Growing Companies for the 9th year in a row. With that explosive growth has come a huge demand for dynamic, engaged, and motivated new staffers.

Like other leading tech startups, YapStone is taking serious action to make their company attractive to the largest and most influential segment of the workforce: millennials.

“At YapStone, we know millennials want to constantly learn and grow, so we are dedicated to career mobility, meaning we want to provide constant development opportunities so that an employee can see their skills and career growing within the company,” says Tenenbaum. “We want to make sure that our employees are not only on a journey to learn, but that they are teaching their fellow employees new skills, technologies, process, etc.”

Tenenbaum believes these 4 assets can help employers attract more millennials to their company:

Upward Mobility

According to a recent Gallup Poll, 87 percent of millennials rate development as being important in a job. At least 25 percent of YapStone’s positions are filled with internal candidates, which allows millennials to identify a specific growth path within the company to expand their career.

“As businesses evolve, employees want to develop through expanding within their current role or moving into new positions,” says Tenenbaum. “We find that not just the best employees, but millennial employees are truly motivated to learn within their job”.

Social Responsibility

YapStone is reaching out to millennials through their YapCares program, which allows employees to give one full day of paid volunteer service within their community. Since 64% of millennials will volunteer if a co-worker also volunteers, implementing a “giving back” program is a great way to encourage bonding and team building through the workplace.

Flexibility

“A flexible time off policy (FTO) allows employees to be responsible for managing their own time off and for fostering effective teamwork through collaboration and open communication, which all impacts employee engagement,” Tenenbaum says. “FTOs empower employees to think what is best for themselves, their department and the company.” In order to allow their employees to refuel, the company offers a flexible time off policy for exempt U.S. employees.

It’s important to work smarter, not just harder. When employees have the ability to take more control of their schedules, they can come back to work refreshed.

Empowerment

“Providing information through channels, such as all hands meetings, is invaluable because it aligns each employee to business objectives focusing their efforts on making impact which is a key component to employee retention,” says Tenenbaum.

In 2017, YapStone will launch a new “teach and learn” brown bag series to be led by fellow employees. At the company’s monthly “Hands On” meeting, company leaders will recognize each YapSter who has either had a lateral move or was promoted to a new role within the organization.

Tenenbaum also notes: “Business information helps employees understand how their role can have greatest impact to the business and employees want to know their job matters.”

The ability to capitalize on millennial work practices will likely be a leading contributor to corporate success in the coming decades. Millennials want to work for companies that take good care of their employees. What’s more, millennials want to patronize companies that do the same. They are more likely than any previous generation to purchase from a company for ethical reasons.

Therefore, the choice to be socially responsible while also offering a positive, engaging work environment will not only allow businesses to attract top talent in a workforce saturated with millennials, but it will also allow them to attract customers from the largest consumer base available.

Companies like YapStone are leading the way. Time will tell which other companies choose to follow suit, and which choose to become obsolete.